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Why Globalstar Stock Soared 30% Today

By Joe Tenebruso – Sep 8, 2021 at 6:57PM

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Investors are targeting Apple's upcoming media event as a possible game-changer for the satellite communications provider.

What happened

Shares of Globalstar (GSAT -2.75%) rocketed 30% on Wednesday, as rumors of a potential deal with Apple (AAPL -2.54%) intensified.

So what 

Late last month, respected analyst Ming-Chi Kuo posited that Apple's new iPhones will support satellite communications. Kuo postulated that partnering with Globalstar would allow the tech titan to offer iPhone users the ability to place calls in areas with non-existent or unreliable cellular coverage. That sent investors into a tizzy, and they quickly bid up Globalstar's shares following Kuo's report.

A satellite is flying above the earth.

Image source: Getty Images.

In recent days, investors' excitement has been building in anticipation of Apple's upcoming media event on Sept. 14. The tech giant is expected to debut its latest iPhone models and announce other new products and services.

Meanwhile, traders are passing around a document regarding a Federal Communications Commission (FCC) permit on social media sites, which they say could be indicative of an agreement between Globalstar and Apple. However, the document does not specifically mention Apple and it's light on details, so this might prove to be mere speculation on their part. 

Now what

With Apple's blockbuster event just days away, we'll soon know whether the new iPhone will feature Globalstar's satellite technology. The show begins at 1 p.m. EDT on Tuesday. Investors should brace for a violent move in Globalstar's stock price -- either to the upside or downside -- depending on what Apple announces that day.

Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Apple. The Motley Fool recommends the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy.

Stocks Mentioned

Globalstar Stock Quote
Globalstar
GSAT
$1.77 (-2.75%) $0.05
Apple Stock Quote
Apple
AAPL
$142.91 (-2.54%) $-3.72

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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